Lassberg v. Bank of America, N.A. et al

Filing 50

ORDER ADOPTING REPORT AND RECOMMENDATION OF THE UNITED STATES MAGISTRATE JUDGE - DENYING 19 Motion to Remand to State Court filed by Leslie C. Lassberg, re 38 Report and Recommendations. It is further ORDERED that Defendant Barrett Daffin Frappier Turner & Engel, LLP, Stonebrook Estates Homeowners Association, Inc., and Charles A. Ward are DISMISSED WITH PREJUDICE. Signed by Judge Ron Clark on 5/30/2014. (baf, )

**NOT FOR PRINTED PUBLICATION**
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF TEXAS
SHERMAN DIVISION
LESLIE C. LASSBERG a/k/a
CLARE LASSBERG,
Plaintiff,
V.
BARRETT DAFFIN FRAPPIER
TURNERE & ENGEL, L.L.P., in its
capacity as an agent and alleged Substitute
Trustee for BANK OF AMERICA, N.A.,
as successor by merger to BAC HOME
LOANS SERVICING, LP, in its capacity
as agent and servicer for WELLS FARGO
BANK, N.A., as trustee for the Certificate
holders of MORGAN STANLEY ABS
CAPITAL I INC. TRUST 2005-WMC3,
MORTGAGE PASS-THROUGH
CERTIFICATES, SERIES 2005-WMC3;
STONEBROOK ESTATES
HOMEOWNERS ASSOCIATION, INC.;
CHARLES A. WARD; MERSCORP
HOLDINGS, INC.; MORTGAGE
ELECTRONIC REGISTRATION
SYSTEMS, INC. (“MERS”), as nominee
for WMC MORTGAGE CORPORATION
and its Successors and Assigns; and the
Successors and Assigns of MERS;
JPMORGAN CHASE BANK, N.A., as
trustee on behalf of the Holders of the
TRUMAN CAPITAL MORTGAGE LOAN
TRUST 2004-2; JPMORGAN CHASE
BANK, N.A. F/K/A CHASE
MANHATTAN BANK, as Trustee of IMC
HOME EQUITY LOAN TRUST 1997-6
UNDER THE POOLING AND
SERVICING AGREEMENT DATED AS
OF OCTOBER 1, 1997; JOHN & JANF

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CASE NO. 4:13cv577
Judge Clark/Judge Mazzant

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DOES 1-50, TRUSTS 1-50,
CORPORATIONS 1-50, as unknown
Claimants of 7113 STONERIDGE DRIVE,
FRISCO, TEXAS 75034,

Defendants.

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ORDER ADOPTING REPORT AND
RECOMMENDATION OF THE UNITED STATES MAGISTRATE JUDGE
Came on for consideration the report of the United States Magistrate Judge in this action,
this matter having been heretofore referred to the United States Magistrate Judge pursuant to 28
U.S.C. § 636. On March 24, 2014, the report of the Magistrate Judge was entered containing
proposed findings of fact and recommendations that Plaintiff’s Motion to Remand Due to Lack
of Subject Matter Jurisdiction [Doc. #19] be denied [Doc. #38]. On April 10, 2014, Plaintiff
filed Objections to Magistrate Judge’s Report and Recommendation [Doc. #40]. On April 17,
2014, Defendants Bank of America, N.A. (“Bank of America”), Wells Fargo Bank, N.A. (“Wells
Fargo”), Merscorp Holdings, Inc. (“Merscorp”), and Mortgage Electronic Registration Systems,
Inc. (“MERS”) (collectively the “Defendants”) filed a response [Doc. #43]. On April 22, 2014,
Plaintiff filed a reply [Doc. #44].
Plaintiff moved to remand based upon one ground: that diversity does not exist because
Plaintiff and Defendants Barrett Daffin Frappier Turner & Engel, LLP (“Barrett Daffin”),
Stonebrook Estates Homeowners Association, Inc. (“Stonebrook”) and Charles A. Ward
(“Ward”) are citizens of Texas. Defendants Bank of America, Wells Fargo, Merscorp, and
MERS removed to this court, asserting that Barrett Daffin, Stonebrook, and Ward should be
disregarded for diversity purposes because they are nominal parties and Plaintiff has no viable
claims against Barrett Daffin, Stonebrook, and Ward. The Magistrate Judge agreed with
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Defendants and recommended that Barrett Daffin, Stonebrook, and Ward be dismissed as
improperly joined.
Plaintiff first objects that the Magistrate Judge disregarded the fact that Barrett Daffin
failed to file any response or contest Plaintiff’s argument that it was not a nominal party.
Plaintiff’s objection has no merit and is rejected. Barrett Daffin was not required to file a
response since it was not the party that removed this case to this court. The proper parties filed a
response to the motion to remand, and nothing requires a nominal or improperly joined defendant
to file a response.
Plaintiff also objects that the Magistrate Judge erred in concluding that Barrett Daffin was
protected by the doctrine of qualified immunity. Plaintiff concedes that qualified immunity
applies to the context of an attorney representing his or her client in litigation, but asserts that
Barrett Daffin’s wrongful conduct of a non-judicial foreclosure sale of a property pursuant to a
power of sale contained in a deed of trust was not performed in the context of litigation. The
court rejects the objection and agrees with the Magistrate Judge that the only facts alleged
demonstrate that Barrett Daffin acted merely as the representative and/or agent of Bank of
America, which would protect Barrett Daffin by the doctrine of qualified immunity. Plaintiff has
alleged no specific facts that allege that Barrett Daffin did anything outside of its representation
to assist in the foreclosure. Defendants rely upon Iqbal v. Bank of America, No. 13–50218, 2014
WL 1017101, at *2 (5th Cir. Mar. 18, 2014) to support their position. Although the court agrees
with Plaintiff that this case is not binding precedent, the court does see that this case is a good
example of why Barrett Daffin is entitled to qualified immunity. In this case, Barrett Daffin was
acting in its role as the law firm hired to conduct foreclosure proceedings. Barrett Daffin was

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improperly joined.
Plaintiff next objects that the Magistrate Judge erred in determining that Ward was a
nominal party and the only relief sought against Ward was for injunctive relief. The court
disagrees that Ward is a necessary party to this case. Ward’s role related to a deed of trust
allegedly filed on August 13, 1997. Ward played no role in the subsequent servicing of the
underlying mortgage loan by Bank of America. There are no claims asserted against Ward and
no facts alleged at the time of removal that would allow for injunctive relief against Ward. The
Magistrate Judge was correct in finding that Ward was a nominal party that was joined merely to
defeat jurisdiction.
Plaintiff next objects that the Magistrate Judge disregarded the legal standard that holds a
substitute trustee liable for its fraudulent conduct, and incorrectly determined that the Plaintiff
has not alleged any bad faith on the part of Barrett Daffin, as trustee. The Magistrate Judge
found that
“Plaintiff does not allege any bad faith on the part of the trustee. Therefore, the trustee is not
liable under the contract Plaintiff had with the companies involved, absent bad faith. Since
Plaintiff does not allege bad faith on the part of the trustee, the trustee does not have liability for
any error it may have made contributing to the breach of contract or wrongful foreclosure claims
of Plaintiff.” The court agrees that there are no allegations of bad faith on the part of Barrett
Daffin. Moreover, there are no actionable allegations of fraud in this case. Plaintiff’s assertion
that her allegation that Barrett Daffin “misrepresented its authority to foreclose” is sufficient is
misplaced. In addition to being a conclusory allegation, Barrett Daffin acted as a representative
and there is no allegation that it did anything outside of that representation.

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Having received the report of the United States Magistrate Judge, and considering the
objections thereto filed by Plaintiff [Doc. #40], and the response [Doc. #43], and reply [Doc.
#44], this court is of the opinion that the findings and conclusions of the Magistrate Judge are
correct and adopts the Magistrate Judge’s report as the findings and conclusions of the court.
It is, therefore, ORDERED that Plaintiff’s Motion to Remand Due to Lack of Subject
Matter Jurisdiction [Doc. #19] is DENIED. It is further ORDERED that Defendant Barrett
Daffin Frappier Turner & Engel, LLP, Stonebrook Estates Homeowners Association, Inc., and
Charles A. Ward are DISMISSED with prejudice.
.
So ORDERED and SIGNED this 30 day of May, 2014.

___________________________________
Ron Clark, United States District Judge

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